Current status of CSR in the realm of supply management: the case of the Korean electronics industry

The purpose of this study is two‐fold: to survey research on supply management and corporate social responsibility (CSR) reported over the past two decades; and to carry out an empirical study of the current status of supply management and CSR in the Korean electronics industry.

The study is based on an explorative approach, wherein “triangulation” is adopted, combining quantitative and qualitative methods. A questionnaire survey with a 132‐company sample is employed as a quantitative method and the telephone interviews with 23 samples are used as a qualitative method. By adopting a triangulation approach, rich data and explanatory power can be obtained to answer the research question.

The results of the study show that “environmental” pressures and standards are widely accepted and implemented for supply management in the Korean electronics industry. However, “social” pressures and standards are still not commonly used and there is a lack of implementation in the entire supply chain in the industry. The main reason for adopting CSR standards is to identify risks and problems in the supply chain, and to avoid or at least reduce the consequences for the final manufacturer. Although most manufacturers in the Korean electronics industry demand certified environmental standards such as ISO 14001 from their suppliers, there is generally a lack of integration of social standards in supplier management or requirements.

Companies today face a growing number of restrictions from national legislations and international standards influencing the environment, labour standards, and human rights issues. Within the Korean electronics industry as a whole there appears to be consensus that it is not easy being “socially responsible”. Vague notions about CSR issues for supply management practices have not provided suppliers with adequate guidance as they seek to improve their performance vis‐à‐vis company standards. The development of evaluation standards to assess suppliers can be a critical factor in improving a firm's performance. Another critical factor is documenting all CSR activities for external requirements such as auditors.

This study is the first empirical attempt to explore CSR adoption and implementation in supply management in the Korean electronics industry.